Exciting pockets of opportunity in a challenging landscape
Soundbars are a great way to enhance your TV experience, and newer technologies such as Dolby Atmos and DTS:X have encouraged shoppers to buy in a more premium range, increasing overall revenues during the last year.
Despite that challenging landscape, there are both short term and long-term opportunities for soundbars.
In the short term, sport events such as the EURO24 and COPA24 are likely to drive TV sales, presenting an opportunity to bundle these with soundbars. Additionally, those consumers who aren’t ready to invest in a new TV right now may well invest in a soundbar to upgrade their current setup.
In the long term, the TV market is ripe for premiumization. Consumer viewing habits have evolved to include other devices, such as laptops or smartphones. This leaves the TV positioned as the preferable device when socializing with friends or watching high quality content (films, gaming, enriched experience). These scenarios also bring audio quality into the equation, creating a great opportunity for soundbars. Audio Quality is the third most important feature for consumers when making their final choice of which TV to buy.
This premiumization trend is already showing in sales of soundbars today, which models that include Dolby Atmos and/or DTS:X gaining by +9% in revenue, and already accounting for 64% of total sales value (up 10 percentage points vs 2022).
Soundbars are well positioned for organic growth
Soundbars, then, show good opportunity for organic growth, with the primary addressable market being consumers who have bought TVs sized 42” or more in the recent years. Sales of these TVs surged during lockdowns and have only stalled since then – whereas sales of soundbars have not grown at the same pace. The closure of this gap marks the current opportunity for organic growth in soundbar sales. Technical innovations such as Dolby Atmos and DTS:X generate additional demand and encourage premium purchases in order to significantly improve the existing TV experience in a cost-efficient manner.
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